The following information is always relevant for short-term decisions:
A) Fixed costs
B) Unavoidable costs
C) Sunk costs
D) Incremental costs

Question

Quizplus · Accepted Answer

Short-term decisions usually involve considering incremental costs, which are the costs that will change as a result of a particular decision. Of the options given, only incremental costs fit this description. Fixed costs and sunk costs are irrelevant in the short-term, while unavoidable costs may or may not be relevant depending on the decision being made.

The Following Information Is Always Relevant for Short-Term Decisions